Bitcoin prices have been extremely indecisive in their actions over the past week, jumping between the $117,000-$120,000 consolidated zones over that period. However, the flagship cryptocurrency fell towards the $115,000 mark following a massive coin movement towards a central exchange on the past day.
Interestingly, prominent market experts have proposed an even more bearish view of Bitcoin prices over the coming weeks. With this latest forecast, BTC prices appear to be at the start of a downward spiral, which could worsen in the coming days.
How BTC prices are at risk of long-term declines?
In a July 25th post on social media platform X, Chartered Market Technician (CMT) Aksel Kibar drew a bearish picture of the price of Bitcoin after falling to $115,000 on Friday. Analysts say the flagship cryptocurrency could be heading towards around $109,000 in the coming days.
Kibal’s bearish attitude revolves around the reverse head and shoulder patterns of the Bitcoin price charts for the weekly time frame. The reversed head and shoulder pattern is a technical analysis formation characterized by three different price troughs, including a low “head” set between two high “shoulders”.
The inverse pattern usually indicates a possible bullish breakout and is verified when the price violates the neckline. As shown in the chart below, Bitcoin prices have already broken through the neckline and reached a new all-time high.
However, Kibal explained that the price breakouts witnessed by Bitcoin may not be the textbook breakouts that are normally expected in most reversed head and shoulder pattern scenarios. Market experts say most head and shoulder breakouts are followed by pullbacks and retests rather than straight meetings.
Chart data provided by analysts show that since May 2017, Bitcoin prices have witnessed more recovery or pullbacks (type 2 continuation) than straight rally after head and shoulder pattern breakout (type 1 continuation). This trend explains the rationale behind Kibar’s bearish projections on BTC over the next few days.
If Bitcoin prices get a deeper correction, like Type 2 continuation, it could potentially return to the neckline – and around $109,000. Such a movement represents a decline of more than 5% from the current price range.
Bitcoin price at a glance
After a terrifying start to the day, it appears that market leaders are recovering well to $115,000 from the recent fall. At the time of writing, BTC priced around $117,323, reflecting a decrease of just 0.6% over the past 24 hours.
ISTOCK featured images, TradingView chart
